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Scottish Widows to launch master trust in £30m workplace pensions push

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Scottish Widows is planning to launch a master trust.

As part of a 12-month, £30m plan to expand its corporate pensions offering into the workplace savings space, Scottish Widows plans to develop its own master trust –  a type of multi-employer scheme designed for auto-enrolment – to “offer greater choice to employers looking to restructure their pensions arrangements”.

The provider is currently discussing charges and availability but has not made a definitive decision on these yet, according to a spokesman.

The firm is also not committing to a date on when the master trust will go live within the 12-month workplace push.

The Government is currently looking to tighten regulations on master trusts through the Pension Schemes Bill, which will have to do more to prove they are financially sustainable after the number of master trusts has increased since the introduction of auto-enrolment.

The Bill will also give The Pensions Regulator greater powers to step in if it thinks a master trust is at risk of failing.

Sources familiar with the formulation of the Bill say that it was nearly derailed by Brexit workload pressures, but will now be pressed ahead.

Scottish Widows is also looking at offering a Lifetime Isa as part of plans to improve access to a wider range of workplace savings products, but is not committing to an April launch when the product is allowed on the market, according to a Scottish Widows spokesman.

Other providers including Hargreaves Lansdown and AJ Bell have confirmed they will also be launching an ISA.

Hargreaves has told Money Marketing it will be ready to launch on day one of the new rules, while AJ Bell will offer the Lifetime Isa on both an advised and non-advised basis as soon as possible after it becomes available.

The provider is also upping its investment in technology, developing a “dashboard” style single view for employees in a group personal pension to access and manage their drawdown options.

Asked about Scottish Widows parent Lloyds Banking Group’s reported plans to launch a robo-advice service, the spokesman confirmed the bank was “looking at it” and “speaking to various bodies” about their in-house views on the market.

Scottish Widows finalised the removal of exit fees on all of its pensions products last week, a move which will affect 31,000 customers but would have a “minimal” impact on the firm’s bottom line, according to the spokesman, despite there being “a lot of work to find out what the impact was going to be”.

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